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SCHOLARSHIPFELLOWSHIP PAYMENTS TO NONRESIDENT ALIENS STATE AND UBF FUNDED

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Title: SCHOLARSHIPFELLOWSHIP PAYMENTS TO NONRESIDENT ALIENS STATE AND UBF FUNDED

1
SCHOLARSHIP/FELLOWSHIP PAYMENTS TO NONRESIDENT
ALIENS STATE AND UBF FUNDED
2
NONRESIDENT ALIEN

This term is used for Tax purposes not
Immigration
As a general rule F-1 and J-1 students who have
been in the U.S. 5 calendar years or less.
J-1 non-students who have been in the U.S. no
more than 2 out of the last 6 years.

3
DEFINITIONS

Types of Payments
Scholarship/Fellowship Amount given to an
individual to aid in study, training, or research
and which does not require work to be performed
to receive the money.
Prizes and Awards Amount received primarily in
recognition of religious, charitable, scientific,
educational, artistic, literary, or civic
achievement or received as the result of entering
a contest.

4
DEFINITIONS

Qualified Expenses Tuition, comprehensive fees,
student activity fees, and direct billed course
and program fees.
Required books, supplies, and equipment
Qualified expenses for student athletes, EMBA,
PMBA, and dental school students .
No tax withholding or reporting for qualified
expenses as long as payments are not made
directly to the individual.

5
DEFINITIONS

Nonqualified Expenses Room and board, travel
and any payments made above and beyond the cost
of the qualified expenses. This includes state
fellowships paid directly to the student.
Subject to federal tax withholding of 14, unless
there is an applicable tax treaty exemption.

6
INTRODUCTION

IRS regulations state that nonqualified
scholarship payments to nonresident aliens must
be taxed.
The tax rate is 14 for students on F-1 and J-1
visas.
Nonresident aliens should be issued a 1042-S
statement at year end.
The 1042-S is a statement issued to nonresident
aliens which reports various income and tax
withholdings.

7
CURRENTLY

State funded- no tax withholding or reporting
Payments are paid from various areas (e.g.
Accounts Payable, Financial Services, UBF, etc).
Qualified and nonqualified expenses are treated
the same.

8
NONRESIDENT ALIEN SCHOLARSHIP/FELLOWSHIP VOUCHER

SEPARATE instructions for completing and MAILING
forms
Scholarship/Fellowship Voucher
Request for Information
Voucher for State and UBF scholarships can be
found at the SRC office website
http//src.buffalo.edu/office/officeforms/generalf
orms.shtml
or on the UBBusiness website
www.ubbusiness.buffalo.edu
under Administrator gt Payments gt State
Scholarship Voucher
Information regarding State fellowships can also
be found at the Financial Services website
http//ubbusiness.buffalo.edu/ubb/cfm/policies/
or on the UBBusiness website www.ubbusiness.buff
alo.edu
under Administrator gt Payments gt State
Fellowship Voucher

9
INSTRUCTIONS FOR COMPLETING FORMS

Forms should be used for scholarships/fellowships
paid with State or UBF funds to nonresident
aliens.
Research Foundation will continue to follow their
current procedures.
Both the voucher and request for information must
be completed.
State fellowship forms ONLY should be sent
directly to Amanda Maines at 120 Crofts Hall.
All other vouchers should be sent directly to
Student Academic Records and Financial Services
(SARFS).
Refunds will be issued by SARFS, the student must
complete the Request for Refund Form found at
the SRC student website http//src.buffalo.edu/pd
f/requestforrefund.pdf.

10
NONRESIDENT ALIEN SCHOLARSHIP/FELLOWSHIP VOUCHER
11
NONRESIDENT ALIEN SCHOLARSHIP/FELLOWSHIP VOUCHER
12
REQUEST FOR INFORMATION
13
REQUEST FOR INFORMATION
14
REQUEST FOR INFORMATION
15
TAX TREATIES

There are 41 countries that have tax treaties for
scholarship income.
Treaty eligibility (W-8BEN)
SSN or ITIN (Individual Taxpayer Identification
Number)

16
ITIN

Applying for an ITIN
Social security numbers are only issued for
employment.
No ITIN 14 tax
Treaty Eligible SSN/ITIN 0 tax

17
STATE FELLOWSHIP PROCEDURE

Complete voucher for state nonresident alien
fellowships. Process all others through
fellowship application.
All State fellowship payments will be made
biweekly.
Additional information required
Begin and end check date
Check sort code
Forward completed voucher and request for
information to Amanda Maines, 120 Crofts Hall.
Please see the following website for more
information http//ubbusiness.buffalo.edu/ubb/cfm/
policies/

18
SCHOLARSHIP PROCEDURE

Department completes -Scholarship/ Fellowship
Voucher
Student completes - Request for Information and
must sign the student certification on the
voucher
All vouchers will be sent to Student Academic
Records and Financial Services (SARFS).
If the form is sent to Financial Services or UBF
first it will be forwarded to SARFS and further
delay the processing.

19
SCHOLARSHIP PROCEDURE

SARFS will determine the qualified and
nonqualified amounts based on the students
account.
The voucher and request for information will then
be sent to either UBF or the State payroll
department.

20
STATE SCHOLARSHIP PROCEDURE

SARFS State Payroll/Financial Services
Qualified Amount
Financial Services SARFS
Nonqualified Amount Net Taxes
State Payroll SARFS
Students with a credit balance on their account
can complete a Request for Refund Form, which
can be found at http//src.buffalo.edu/pdf/request
forrefund.pdf

21
UBF SCHOLARSHIP PROCEDURES

SARFS UBF
Qualified Amount
UBF SARFS
Nonqualified Amount Net Taxes
UBF SARFS
Students with a credit balance on their account
can complete a Request for Refund Form, which
can be found at http//src.buffalo.edu/pdf/request
forrefund.pdf

22
RF PROCEDURES

The process for utilizing RF funds for payments
to nonresident aliens has not changed.
The RF does not pay students directly.
All payments for tuition remission are remitted
directly to SARFS.
Tuition remission is requested by completing and
submitting a Grant Billing Form.
Salary and fellowship payments are processed
through the payroll mechanism and are therefore
taxed accordingly.

23
TIPS

IRS Publication No. 515, Withholding of tax on
Nonresident Aliens and Foreign Entities at
http//www.irs.gov/pub/irs-pdf/p515.pdf
State processing may take 4-6 weeks to complete
from the start of the semester due to the State
payroll cycle
Multiple awards- First come, first serve
Notification of changes to students registration
after the award has been processed should be done
immediately

24
TIPS

Receipts
Income Tax Return
ISSS website http//wings.buffalo.edu/intlservices
/index.html

25
CONTACTS
Foreign National Tax Unit SARFS Amanda
Maines Kellie Kostek amaines_at_business.buffalo.e
du kkostek_at_buffalo.edu 645-5000 ext.
1286 645-5683 UBF Financial
Services Elaine Schaffer Carrie
Grimshaw eschaffe_at_buffalo.edu cgrimshaw_at_business
.buffalo.edu 645-3013 645-5000 ext. 1338
26
QUESTIONS?
27
THANK YOU!

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